Turkey’s Economic Sanctions Regime: A Comprehensive Overview
Introduction
In response to the increasing threat of terrorism and proliferation financing, Turkey has implemented a robust economic sanctions regime to prevent the misuse of its financial system for illicit purposes. This chapter provides an in-depth analysis of Turkey’s economic sanctions regime, including its legal framework, enforcement mechanisms, and potential consequences for violators.
Compliance Expectations
Financial institutions, designated non-financial businesses and entities, individuals, institutions, and organizations are required to report any assets related to listed individuals or transactions under the United Nations Security Council Resolutions (UNSCR) within seven days. The competent authorities expect compliance with these regulations through the implementation of a risk-based approach.
Compliance Programmes
The Law on Prevention of Laundering Proceeds of Crime and Regulation on Compliance Program for Prevention of Laundering of Proceeds of Crime and Financing of Terrorism (ROC) requires certain obliged institutions to develop and implement a compliance programme. The scope of the mandatory compliance programme includes:
- Developing institutional policies and procedures for compliance
- Developing a risk management policy
- Implementing monitoring and control mechanisms
- Designating a compliance officer and creating a compliance department
- Conducting internal audits
- Providing training for personnel
Enforcement
The enforcement of economic sanctions is carried out by the Ministry of Interior, the Financial Intelligence Unit (MASAK), and the office of the public prosecutor. Criminal penalties for violating economic sanctions laws and regulations include:
- Imprisonment
- Fines
- Administrative penalties
Individuals who fail to comply with asset freeze decisions may face imprisonment from six months to two years or a judicial fine applied to the respective jail term. Legal entities that fail to comply with these decisions may be subject to:
- Temporary suspension of activity
- Replacement of directors and representatives
- Removal of individuals under investigation from their positions
Civil Enforcement
In addition to criminal enforcement, civil sanctions are also available for violators. The Ministry of Interior has the power to remove individuals under investigation from their positions as director or representative as a security measure. Other security measures include:
- Temporary suspension of activity of the association
- Replacement of directors and representatives
- Prohibition of serving on all organs of the association other than the general assembly
Appeal Process
The appeal process for criminal sanctions is governed by Turkish law. However, there are no specific provisions governing the appeal process for civil sanctions.
Statute of Limitations
The statute of limitations for levying administrative fines for economic sanctions violations is five years from the date of violation of obligations.
Additional Measures
There are currently no proposed or under consideration additional economic sanctions-related measures in Turkey.
Conclusion
In conclusion, Turkey’s economic sanctions regime is designed to prevent the misuse of its financial system for illicit purposes. Compliance with these regulations is essential, and violators may face severe criminal and civil penalties. The competent authorities are committed to enforcing these regulations effectively to maintain the integrity of the Turkish financial system.